As the quantity of data available and accessible multiplies seemingly daily, channel organizations are struggling with how to wrangle all of it and turn it into something useful. In the past (and still today for many companies), sales data was managed in basic spreadsheets and communicated by a series of emails between vendor, distributor, and reseller. However, as data becomes a more integral part of the sales channel and the technologies available to manage that data become more widely used, organizations will be challenged with addressing the accuracy of their data, the business processes to manage it, and maximizing its usefulness to impact the bottom line.
Unfortunately, right now we have access to a whole lot of data, but not enough time (or expertise) to manage it effectively. According to eConsultancy, 22 percent of information about contacts, leads, and customers contains inaccuracies. And surprisingly, this number has gotten worse. A year ago, the rate of inaccuracies was only 17 percent. With more data comes more errors.
More critically, research by Experian indicates that 27 percent of revenue is wasted due to inaccurate and incomplete customer or prospect data (on average for U.S. respondents).
Whether your company has implemented a comprehensive data management platform or is still working with spreadsheets (or something in between), your customer data can be a valuable tool if it's used effectively.
Here are some things powerful renewals teams do with their customer data to optimize their renewal business:
Automate Renewals Data Based on Business Process Rules
Pulling a renewals account through the sales funnel becomes faster, easier, and more successful when you automate your quoting process, based on set business process rules and guidelines for data collection. These processes will be unique to every organization, but may include:
- Automatically publish a list of live opportunities and distribute it to renewals specialists, rather than requiring them to sift through spreadsheets to find them.
- Define sales strategies for every single renewal opportunity, which may be grouped by contract value. Although many organizations neglect smaller renewals, the high volume of these opportunities can add up to significant revenue if they are handled with an efficient sales strategy.
- Give at least 90 days’ notice to channel partners of upcoming expiring contracts.
- Collect data on every aspect of the opportunity-to-payment cycle to help inform necessary improvements, including timeframes to help identify bottlenecks and channel partner performance.
- Define mandatory data fields (e.g. serial number [hardware] or maintenance start and end dates [contract/renewable products]) to help improve data quality.
- Set some fields to auto-populate to minimize the potential for human error. For example, the contract start date may be defined based on the invoice date, and the end date set for 12 months later. According to Experian, 59% of companies say that human error is the root cause of data errors, and 44% percent say that incomplete/missing data is the most common data problem.
- Pre-validate data to prevent widespread data errors. This may include confirming that the data doesn’t already exist before entering it into the system, or that the customer still owns the product that is being renewed.
Setting up some basic processes and workflows around data collection aren't the only nor perfect solution, but they can help establish a system for collecting more reliable customer data. Every improvement means less time wasted and a more efficient renewals business.
Get Important Customer Data Right from the Beginning
When the renewals team becomes aware of a contract due for renewal, but the customer data is incomplete or inaccurate, there is a significant opportunity cost. Renewals specialists then need to track down the correct phone number or email address to reach out to the customer, or worse yet, they discover during communications with the customer that they have incorrect information about the product or contract. The negative impact on customer relationships as a result of bad data can't be overstated.
In an ideal world, accurate and complete customer data should be collected at the net new sale point. The responsibility for this task should be clearly assigned to specific individuals, with performance assessments tied to their effectiveness. If this takes place, the rest will fall into place. Unfortunately this does not always happen. So to further strengthen customer data, an additional step should be created at the time a contract renewal is processed that validates existing data and fills in any missing information.
Get specific tips and strategies to put your customer data to work driving renewals by downloading our ebook, "Shockingly Easy and Successful Renewal Quoting."